In the latest issue of Astounding, our old pal and brother-fan, Milt Rothman makes his professional debut under the pen name: Lee Gregor. And Milt is to be congratulated on the story.... it is definitely pro and not fan fiction.

I also want to put in my two-cents-worth on the subject of fan fiction. There has been a strong trend away from fiction in fanzines of late: SPACEWARP stopped using fan fiction shortly before the end; ORB followed suit; WYLIE STAR will switch; most of the new mags are starting out with non-fiction plans. I think fiction is just as important (if not more so) in fmz as articles. Where else will embryo pro-authors get their start?

Laura, whose ambition is to become a professional writer, has been writing STAR TREK fiction since her early teens, and was recently nominated for a Hugo Award for fan fiction for her series ‘Federation and Empire’.

1997 September 26, Entertainment Weekly, page 84:

Chris Carter may bar X-Filers Mulder and Scully forever from consummating their deep bond—but it's a common fantasy in the archives of fan fiction, where familiar TV and movie characters populate digital poems, scripts, short stories—even full-length novels—that span hundreds of websites and Usenet discussion groups. Readership figures are elusive, but fanfic's America Online index page has collected a half million hits in the past year.

This can be, as you note below, quite fun and entertaining, but I do think that it is very easy for people to lose track of the fact that all of these "speculations" are just fan fictions that have little to do with what Tolkien actually wrote.

fan fiction - Sometimes improperly used to mean fan science fiction, that is, ordinary fantasy published in a fan magazine. Properly, the term means fiction about fans, or something about pros, and occasionally bringing in some famous characters stf stories. It may refer to real fans by name (Tucker nudged Brackney, who was nursing a "black eye"), or may be about types, especially Joe Fann.

Triode specialized in humorous ‘fan fiction’—stories written about actual personalities in the SF field—and dates from the period in which science fiction fans did not take themselves quite so seriously as nowadays, and those who made religion from an enthusiasm were generally mocked for it.